IG Group Announces The Second Batch Of A £250M Buyback Program

IG Group, a spread betting, and contracts-for-difference (CFD) brokerage firm, has announced the second batch of an expanded £250 million buyback program. The broker initially announced the program in July.

IG Group started with a £100 million repurchase of listed ordinary shares in August. The broker is now working with Morgan Stanley on the second tranche with a maximum aggregate market value of £150 million.

IG Group Announces Second Tranche of £250M Buyback Program

IG Group says transactions will happen per the board’s authority. The program commenced on November 7, 2023, and is set to be completed on or before July 31, 2024.

IG Group opined that having a balanced approach between funding growth in the key channels and bringing excess liquidity back to shareholders is the purpose behind this program.

It is not the first time IG Group is expanding this program. In April, it extended it by £50 million. This extension added to the previous £150 million buybacks announced by the company.

According to the board, the process seeks to reduce the company’s share capital by purchasing ordinary shares using the existing cash reserves. The company also says special share buyback programs and other distributions will happen regularly.

IG Group Announces Several Changes

IG Group has announced multiple changes in its business. Last month, the company announced trimming around 300 jobs. The number was equivalent to about 10% of its entire workforce by the end of its 2023 fiscal year.

The broker said the layoffs were part of a broader initiative to trim costs and streamline operations in response to the current market changes.

By 2024, IG Group plans to have £10 million in savings. The amount is expected to increase to £40 million in 2025 and £50 million in 2026. As market conditions improve, the company will also reduce its variable costs for 2025 by another £10 million.

The company is taking these steps as other brokerage platforms, such as IG Group, report declined trading volumes because of broader economic tensions. During the first quarter, IG Group also reported a drop in active users, signaling a trend across the broader market.

IG Group said the total active users reached 358,300 compared to 381,500 a year earlier. The figure dropped by 6%, but it is more than double the number of clients before the pandemic. The first trades dropped but remained above the pre-pandemic levels.